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Economy

More trade deals, Africa integration on Uhuru's agenda as he visits China

President Uhuru Kenyatta at State House, Nairobi. PHOTO | WILLIAM OERI | NMG
President Uhuru Kenyatta at State House, Nairobi. PHOTO | WILLIAM OERI | NMG 

President Uhuru Kenyatta says he is returning to Beijing to ask for China’s hand in supporting African integration, and to discuss ways in which the Chinese will accept more Kenyan goods into its market.

In a preparatory press briefing on Tuesday night in Nairobi, the President spoke of his ambition to “deepen our partnership” with the Chinese, but said there are two key areas his trip will focus on.

“It will be priority to see to it that it (the Standard Gauge Railway) ends not just in Naivasha but [on to] Kisumu and into the hinterlands in Uganda, Rwanda and the DRC, to open up Africa’s potentiality,” he said at State House.

“We will try to push for more African goods into the Chinese market so that we can have an opportunity for both of us to benefit.”

The President is due to travel to Beijing this Saturday for a conference on trade connectedness known as the One Belt One Road Forum.

The Forum is part of Beijing’s 2013 initiative to develop land and sea trade routes in Asia, Europe and parts of Africa, to mimic the historical Silk Road, covering about 60 countries.

Though expensive, the Chinese government hopes to use this One Belt-One Road Initiative to increase exports in the next ten years.

Beijing is pumping $1 trillion into the project and encouraging state corporations to take part, mainly in investing in airports, roads, railways and seaports in countries that fall in the belt.

Continental network

And as has been tradition, the President spoke about the Standard-Gauge Railway, saying he wants the Chinese to help complete it beyond Kenyan borders so as to boost a transport network within the continent.

“I do not see it as a Kenyan railway but as an African railway. It is a railway line that links Asia to Africa and ultimately to the Americas as we look forward.”

As his pet project since he took office in 2013, President Kenyatta first travelled to Beijing in August 2013, securing a $5 billion investment pledge that included financing deal for the 472-kilometre railway line.

The financing was later inked in 2014 in Nairobi when Chinese Premier Li Keqiang visited.

But the completion of the Sh327-billion railway line alone risks being a disused facility unless it can reach other countries, to ensure goods can move along it and help repay the construction debt.

Kenya had asked further assistance to extend the railway line to Naivasha and onwards to the border with Uganda.

On Tuesday, the President only hinted this is among items on the agenda as he plans to meet with President Xi Jingping on the sidelines of the Beijing conference.

“All those things, of course, are on the agenda. But we don’t want to pile all of them together. You don’t go with an entire wish list, you work with what is achievable,” he told journalists.

Trade imbalance

But China’s foray into Africa and Kenya in particular has seen them benefit more than locals. 

China was the largest supplier of goods to Kenya in 2015.

In 2015, it sold to Kenya goods worth Sh320.8 billion and imported goods worth Sh8.4 billion from Nairobi, mainly titanium, tea, coffee and fresh vegetables.

Despite China being Kenya’s largest trading partner at Sh600 billion, twice the value in 2013, just a small portion of that money came to Kenya.

“This whole Belt idea is to open up and deepen integration of economies. We would want to see an increase in the uptake of Kenyan goods into the Chinese market.

“If we are able to achieve those objectives, it is a win-win situation for us all.”

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